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Goldman raises Fed rate hike forecast after Powell's hawkish stance
Federal Reserve still unsure on where inflation will settle: Panel
Barron’s markets editor Ben Levisohn, Barron’s reporter Carleton English, and Barron’s associate editor Jack Hough discuss recent market trends, inflation, and the IRS beefing up its auditing on ‘Barron’s Roundtable.’
Goldman Sachs strategists see the Federal Reserve charting an even more aggressive course of interest rate increases after the U.S. central bank took an increasingly hawkish stance during its two-day meeting.
The bank's economists – led by Jan Hatzius – said in an analyst note on Thursday that they expect the Fed to continue raising the benchmark federal funds rate until it hits a target range of 4.5% to 4.75%, up from their previous estimate of 4% to 4.25%. That includes rate hikes of 75 basis points in November, 50 basis points in December and 25 basis points in February.
The projections come shortly after Fed policymakers voted unanimously to approve a third consecutive 75-basis-point interest rate hike.
In addition to the large rate hike, Fed officials laid out an aggressive path of rate increases for the remainder of the year. New economic projections released after the two-day meeting show policymakers expect interest rates to hit 4.4% by the end of the year, suggesting that another three-quarter percentage point increase is on the table.
BILLIONAIRE DAVID RUBENSTEIN WARNS INFLATION WILL BE 'DIFFICULT' FOR THE FED TO REDUCE